Cllr John Cope is the Chairman of the Conservative Councillors’ Association and the Conservative Group Leader on Elmbridge Borough Council.
A big story of the summer recess is the Prime Minister’s devolution paper, Rewiring the State. It promises mayors a share of income tax, greater retention of business rates, and strategic authorities covering the whole of England by the end of 2028, with much of the detail deferred to a white paper alongside the Budget in October.
There are things here that Conservatives can welcome in principle. As a party we have long argued that decisions are best made locally, by people who know their communities and are accountable to them. Indeed, it was George Osborne who struck the original Greater Manchester deal in 2014 that created the mayoralty Andy Burnham went on to hold. So we should not be reflexively hostile to the idea of pushing power out of Whitehall. The question is whether this paper does that.
It does not. At least, it didn’t survive first contact with the real world. Within hours of publication, the whole exercise was exposed by one simple exchange. Ben Houchen, the Conservative Mayor of Tees Valley, welcomed fiscal devolution and said that if his area was handed a slice of locally raised income tax and business rates, he would create a rebate scheme to put money back into the pockets of the families who earned it. The answer from the Government came back the same morning: no. The First Secretary of State told him it was, and I quote, “not in their gift”, and that Ministers “would anticipate that the money would be invested into public services”.
Think about what that means. Mayors will be handed a share of the taxes their residents pay, but only on condition they spend it the way Whitehall approves. They cannot vary a rate. They cannot hand a penny back. As Houchen put it, this is not devolution; it is pocket money with strings attached. The man who spent a decade demanding Whitehall loosen its grip has walked into Downing Street and gripped tighter than the Ministers he complained about.
This is top-down devolution. Labour say they want to empower local communities, but Ministers are telling local leaders what they can and cannot spend their money on, blocking tax cuts, and through the new (un)Fair Funding Formula, squeezing funding for Conservative councils that have kept council tax bills low for their residents, in effect punishing them for their prudence.
The numbers also tell a story. In figures obtained by James Cleverly, we now know that council tax across England is projected to rise by more than £17 billion by the end of the decade, from £41 billion to nearly £59 billion, adding over £550 to the average Band D bill. This is because the Government has baked in councils putting council tax up by the maximum allowed, year after year, while grant funding is redistributed away from councils that have kept bills low. This instinct follows the Manchesterism model: the Prime Minister’s mayoral precept more than doubled during his time in the role.
For councillors, what feels like small print is just as worrying. This paper is less about pushing power down to communities, and more about pulling power up from councils into the hands of around thirty regional mayors. This risks sidelining local councils and ignoring local identities. Among the paper’s “immediate steps” is activating mayoral intervention powers in the planning system, so a single regional figure can override the elected councillors who know the street, the site, and the residents affected. It compounds the new planning changes due in October, which remove most planning decisions from democratic oversight.
These aren’t political points: neutral observers see the problem too. The Institute for Government has asked the obvious question the paper dodges: how much freedom will mayors actually have to spend this money? The Institute for Fiscal Studies warns that everything hinges on an equalisation formula that will, of course, be run by the Treasury. The Local Government Chronicle counted the phrase “local leaders” nineteen times in the document and concluded it is mostly a synonym for “elected mayors”. Power to the people this is not.
We now need to put forward a Conservative vision of devolution: trusting local people and their elected representatives, including the freedom to tax less, spend less, and do things differently. Burnham’s version at face value translates as devolution, but only if it is big state, high tax.
Because the real test of devolution is simple: do you support it when local people use their new powers to do things you don’t like politically? A Conservative mayor asked to cut taxes for his residents, and the answer from this Labour Government was no. They have failed this test at the first attempt.
What works in Manchester will not necessarily work for Hampshire, Berkshire, Lincolnshire, or Derbyshire, and no amount of rebranding Whitehall-led devolution will change that.